HP Acquires Palm

HP has recently announced its acquisition of Palm for $1.2 billion, which works out to $5.70 per share of Palm common stock. The deal will be closed by the end of next month, which marks the end of HP's third fiscal quarter of the year.

In addition, PreCentral's managed to get a copy of Jon Rubinstein's (Palm CEO) letter to Palm employees. Read it here.

Press Release:

PALO ALTO, Calif. & SUNNYVALE, Calif.--(BUSINESS WIRE)--HP (NYSE:
HPQ - News) and Palm, Inc. (NASDAQ: PALM - News) today announced that
they have entered into a definitive agreement under which HP will
purchase Palm, a provider of smartphones powered by the Palm webOS
mobile operating system, at a price of $5.70 per share of Palm common
stock in cash or an enterprise value of approximately $1.2 billion. The
transaction has been approved by the HP and Palm boards of directors.

The combination of HP's global scale and financial strength with Palm's
unparalleled webOS platform will enhance HP's ability to participate
more aggressively in the fast-growing, highly profitable smartphone and
connected mobile device markets. Palm's unique webOS will allow HP to
take advantage of features such as true multitasking and always
up-to-date information sharing across applications.

"Palm's innovative operating system provides an ideal platform to expand
HP's mobility strategy and create a unique HP experience spanning
multiple mobile connected devices," said Todd Bradley, executive vice
president, Personal Systems Group, HP. "And, Palm possesses significant
IP assets and has a highly skilled team. The smartphone market is large,
profitable and rapidly growing, and companies that can provide an
integrated device and experience command a higher share. Advances in
mobility are offering significant opportunities, and HP intends to be a
leader in this market."

"We're thrilled by HP's vote of confidence in Palm's technological
leadership, which delivered Palm webOS and iconic products such as the
Palm Pre. HP's longstanding culture of innovation, scale and global
operating resources make it the perfect partner to rapidly accelerate
the growth of webOS," said Jon Rubinstein, chairman and chief executive
officer, Palm. "We look forward to working with HP to continue to
deliver industry-leading mobile experiences to our customers and
business partners."

Under the terms of the merger agreement, Palm stockholders will receive
$5.70 in cash for each share of Palm common stock that they hold at the
closing of the merger. The merger consideration takes into account the
updated guidance and other financial information being released by Palm
this afternoon. The acquisition is subject to customary closing
conditions, including the receipt of domestic and foreign regulatory
approvals and the approval of Palm's stockholders. The transaction is
expected to close during HP's third fiscal quarter ending July 31, 2010.

Palm's current chairman and CEO, Jon Rubinstein, is expected to remain
with the company.